I received a scholarship for my education, with the stipulation that I work for the employer that provided the scholarship, otherwise the scholarship would turn into a loan that would need to be repaid.
I received a job offer with another company that makes more financial sense to take and repay this scholarship. My problem is that these funds were reported in box 5 of my 1098-T over the course of three years, so it's my understanding that I paid income taxes on these funds, which should not be the case for a loan.
Now that those funds are being retroactively reclassified as a loan, how do I deal with my taxes? Do I have to refile for the years that I received the scholarships and reclassify those amounts as a loan? If so, how do I account for the discrepancy in what is now true and what was listed on my 1098-Ts (do I just... change box 5 to $0 or what)? If not, can I just deduct payments towards that loan off of this year's return?
I'm not quite sure where to start on this one, so any help would be greatly appreciated.
Thanks!
Edit: I should have also mentioned that the amount in box 5 was significantly greater than the amount of box 1 since the scholarship included a hefty stipend, which is why I'm concerned with the income taxes I paid.
